Europe Protests Austerity With Strikes in Spain, Italy

By Emma Ross-Thomas and Ben Sills -
Nov 14, 2012

Spanish workers staged a second general strike this year as unions across Europe prepared the biggest coordinated protests yet against budget cuts that policy makers say are unavoidable and labor leaders called economic suicide.

In Spain, unions said most auto and metal workers joined the strike and demand for electricity was 12 percent below usual. One of Portugal’s two biggest labor groups also called a strike. Partial walkouts are planned in Greece and Italy, and French unions are urging workers to join protest marches.

Opposition to the cuts in health, education and welfare benefits demanded by AAA-rated euro members such as Germany and Finland is growing along with evidence that those measures are failing to rein in the budget deficits or bring down borrowing costs. Demands for less austerity are gaining traction as the International Monetary Fund recommends nations including Spain slow the pace of budget cuts.

“This is a strike against the suicidal economic policies of the government,” Ignacio Fernandez Toxo, head of Spain’s CCOO union, told supporters late yesterday.

Rajoy, who won a landslide election victory a year ago, is wrestling with the second-largest budget deficit in the euro region while trying to revive the economy from a five-year slump that pushed the jobless rate to 26 percent. He is trying to avoid following Portugal, Greece and Ireland into seeking a sovereign bailout as Spaniards resist the measures being implemented as a condition for the 100 billion-euro ($127 billion) European bank rescue he agreed to in June.

No Retreat

Economy Minister Luis de Guindos was the first minister to comment publicly on the strike, saying the government would press ahead with the policies that prompted the protest.

“The government is convinced that the road it has embarked on is the only one possible, the only alternative available to us to exit the crisis,” he told reporters in Parliament, where police stepped up security ahead of protests planned later today.

Across much of the continent, workers took to the streets to challenge that diagnosis. Unions organized demonstrations in cities across Italy and police clashed with protestors, mostly students, in Rome, Milan, Turin and Padua.

One officer was in critical condition in Turin after he was beaten by a group of demonstrators wielding sticks and bats, news agency Ansa reported. Demonstrators attacked bank branches and an office of power company Enel SpA (ENEL) and two policeman in Padua were injured by a powerful firecracker, Ansa said. Demonstrations in Paris began at 2 p.m.

Justification

“We take these demonstrations as a justification for the growth measures we are pushing for today in Europe,” French Finance Minister Pierre Moscovici said today at the National Assembly, the lower chamber of Parliament.

Portuguese air and rail transport was disrupted and the metro was shut down in the capital Lisbon where the CGTP labor group called a strike to protest wage and pension cuts. Economic activity in Portugal was otherwise little affected. Power demand was running at its usual level and at the port of Sines, where Galp Energia SGPS SA (GALP) refines as much as 220,000 barrels of crude a day, operations were running normally, the port operator said.

Spanish unions, which staged two general strikes in the decade through 2010, have called as many walkouts since Rajoy took office as they tap into taxpayer anger at shouldering cuts and the cost of rescuing banks at the same time. As outrage also grows over Spaniards losing their homes for failing to keep up with mortgage payments, Rajoy pledged last week to rush through measures to prevent families being evicted.

‘Extreme’ Cases

Even as he enjoys a parliamentary majority, Rajoy is seeking the support of the main opposition Socialist party for the changes, and negotiations are set to resume for a third day today. Banks, which are seeing an increase in protest graffiti at branches, have already agreed to a two-year freeze on evictions for “extreme” cases.

Between 50 percent and 100 percent of auto workers joined the strike during the night shift and 83 percent of metal workers walked out, Spain’s Comisiones Obreras union said in a statement. More than half of all health-care workers boycotted work and 73 percent of teachers, the unions said.

Power demand was 12 percent below usual at 3 p.m., data from grid operator Red Electrica Corp SA (REE) showed. That suggested today’s stoppages had less impact than the previous general strike in March when power usage was as much as 22 percent lower.